Was goal of Lewiston casino backers a quick payout?
On January 27, 2012 At 6:30 pm
Responses : 7 Comments
In the summer of 2009, Great Falls Recreation and Redevelopment Corporation was formed with the intent of turning an abandoned mill in Lewiston into a casino. Great Falls bought an option on the mill from the City of Lewiston, and would close on the deal should voters approve a referendum. That initiative was rejected in November 2011.
Some of the investors in Great Falls include:
Dr. Ron Chicoine
Wendy Chicoine-Poutre and Tim Poutre
Floentia Mendros (mother of Stavros Mendros, the manager of Great Falls)
Peter Robinson (brother of LePage adviser Ann Robinson)
Elizabeth and James Tracy
Great Falls pitched the proposed casino as a job creator and tax generator. This add, paid for by People of Lewiston and Auburn Committee (a PAC formed to support the project), is a typical example:
But in a story from October 2011 in the Press Herald, we learn:
The group has not done a detailed analysis of what the project would entail, but Chicoine said that if it gets approval in November, it will move quickly to open the casino. A restaurant and other entertainment options could follow, but he said the group did not want to spend money on planning before it had approval from voters.
Chicoine said nearly all of the investors live in Maine. To his knowledge, his sister who lives in New Hampshire is the only out-of-state investor. He said he does not know how many investors there are in total.
“The group has not done a detailed analysis of what the project would entail.” This is just simply remarkable, especially from a business standpoint for a project this large, not to mention the impact on Lewiston, Auburn, and the surrounding communities.
In late December, Dennis Bailey, the head of CasinosNO!, filed an complaint with the Maine Ethics Commission, asking it to investigate the People of Lewiston and Auburn Committee regarding contributions from a company in Georgia, GT Source Corporation. Bailey obtained an agreement between Great Falls and a Maryland-based company called M Five.
After a hearing this past Wednesday, the Ethics Commission voted to have staff investigate the PAC, GT Source, and others involved – Susan Sharon of Maine Public Radio has this excellent report on what is a complicated story. I urge you to listen to it as it provides necessary background information.
Reading through the report prepared for the Ethics Commission prepared by Executive Director Jonathan Wayne, there is this interesting tidbit:
The complaint submitted by CasinosNO! is largely based on a proposed and unexecuted Option Agreement between Great Falls and M Five, Inc. The agreement is signed by all of the members of Great Falls LLC. No members of M Five, Inc., have signed the proposed agreement.
In the proposed agreement, Great Falls would grant its option to buy and develop Bates Mill Building No. 5 to M Five, Inc. in exchange for M Five, Inc. making $600,000 in option payments to Great Falls. In order to exercise its option, M Five would pay $5,000,000 to Great Falls and would make 40 quarterly payments to Great Falls which equal a percentage of revenue of the casino.
$5 million plus 40 additional payments, 10 years of profit sharing.
All for securing the rights to build a casino.
Now it’s clear why a detailed analysis was not done on the project.
A comment on journalistic practice at Dirigo Blue:
Andi Parkinson, an assistant editor here at the blog, recently joined the Jon Hinck for Senate campaign. When she did so, she agreed not to post or comment here about the Democratic Senate primary.